Google is to pay a record penalty of 4.3 billion euros for competition violations. This was shared by EU Commissioner Margre Vestager. It is highest fine that European Commission has so far imposed on a group.
The EU commission accuses US company of abusing its market power and making unacceptable specifications for its Smartphonebetriebssystem Android. Google requires, among or things, mobile phone manufacturers to preinstall certain apps such as Google search or Chrome web browser on ir mobile devices if y want to use Android.
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The EU’s top competition officials see this as a breach of competition. “Google used Android as a vehicle to cement its dominance as a search engine,” Vestager said. Among or things, company paid manufacturers to only install Google search and select non-competing vendors. It also hindered competing systems. Google has a worldwide monopoly with its operating system: 86 percent of all smartphones, according to Market research institute Gartner, ran in first quarter of 2018 with Android.
Google rejects competition violations
Google announced opposition to decision. It is feared that EU decision will disrupt ” sensitive balance” that has been achieved with Android, writes CEO Sundar Pichai in a blogpost. “The decision also sends a problematic signal to benefit of proprietary systems and to detriment of open platforms.”
Previously, company had already argued that operating system could be downloaded free of charge by anyone. The agreements with partner companies would be made on a voluntary basis. “Anyone can download Android without Google,” it says in a post. The company also pointed out that manufacturers would have to assure that ir products were compatible with Android apps. The reason for this, however, is that orwise not all applications would work on all devices equipped with operating system.
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Already 2017 company should pay a sum of 2.4 billion euro. It was also a violation of competition at time: EU commissioners accused company of favouring its own offer for price comparisons. The disadvantage of competitors. In order to meet EU requirements, platform stored its shopping search in a separate department. Anor decision of European Commission is still pending. For two years, it determines wher Google is disadvantaged with its advertising business competitors.
Also Amazon and Facebook in EU’s sights
Europe’s competition custodians follow a long tradition with ir decision of Wednesday. They have repeatedly denounced monopoly position of companies and have imposed high penalties. Tech companies in particular have been in spotlight for years: The EU commissioners have already imposed several penalties on Microsoft alone, partly because of exploitation of market power of its operating system windows and preinstallation of in-house browser Internet Explorer.
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Last year, EU imposed several penalties on major techs. She demanded a repayment of 250 million euros from Amazon e-commerce platform because she received unfair tax breaks in Luxemberug. In same year, Commissioners also paid a fine to Facebook, social network had to pay 110 million euros. Prior to acquisition of WhatsApp, it had indicated that data could not be reconciled by users. The possibility was, however, that Facebook was well known.
Even if penalty for Google is as high as no EU fine previously, company should be able to pay you easily. The parent company Alphabet has stated its cash reserves and collateral in its quarterly figures – y are at a good 103 billion US dollar (currently about 89 billion euros). The EU penalty is not even five percent of this sum.
